The Historical Cost Principle Requires That When Assets Are Acquired

question 69

Multiple Choice

The historical cost principle requires that when assets are acquired, they be recorded at

• A)fair market value.
• B)the amount paid for them.
• C)selling price.
• D)list price.

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Definitions:

Isostatic Rebound

Uplifting caused by the removal of weight on top of the crust, as when an ice sheet melts away or when erosion strips material off the top of a thick crustal root of a mountain.

Ice Sheet

A large mass of glacier ice that covers an area of over 50,000 square kilometers, often found in polar regions.

Crustal Root

The downward extension of the Earth's crust into the mantle beneath mountain ranges, helping to support the elevation of the mountains above.

Thrust Faults

Type of fault where the hanging wall moves up relative to the footwall, common in areas of compression.